My NY State Resident Client received a K-1 prepared by a reputable Accounting Firm, which states that:

"The Firm is treated as a S Corporation for Federal and California purposes and C Corporation for New York, New Jersey, and Washington DC, As a shareholder of the Firm that files a California S Corporation Tax Return, you will have a California individual income tax filing requirement."

I input the S-Corporation K-1 correctly using source codes for all (Fed with the N and CA with the S) and even tried putting $0 for NY with the S, but it did not work; ProConnect is still overriding the entries and adding it to the NY State Tax Return since NY State taxes all income.  The problem is that NY has already taxed this income as a C Corporation on a NY State Franchise Tax Return.  Is there any other work around other than filing the Federal and California first and then removing the K-1 and filing the NY? 

For such a simple thing I have wasted so many hours and now with all my attempts to remedy I have to review the Federal and California again thoroughly to make sure I did not inadvertently change anything.

Any help would be appreciated.